Industrial Sector Updates – Industrial Policy, Ease of Doing Business, etc.

Production Linked Incentive (PLI) Scheme Versions 1.0 vs 2.0 Comparison

Prelims OnlySchemes | Economics | Mains Paper 3: Effects Of Liberalization On The Economy, Changes In Industrial Policy and their effects on Industrial Growth

PLI 1.0

PLI 2.0
Launch Year March 2020 May 2023
Objective Promote domestic manufacturing, reduce imports, create jobs Enhance IT hardware manufacturing, increase global competitiveness
Budget ₹7,350 crore (for IT hardware) ₹17,000 crore (for IT hardware)
Duration 4 years 6 years
Incentive Structure 1% – 4% of incremental sales over the base year ~5% of incremental sales over six years
Sectors Covered
  • Initially focused on 3 sectors: Mobile manufacturing, electrical components, and medical devices.
  • Later expanded to 14 sectors, including: Specified electronic components, critical key starting materials (pharma), auto components, pharma drugs, specialty steel, telecom and networking, electronics/technology products, white goods (ACs, LEDs), food products, textiles (MMF/technical textiles), high-efficiency solar PV modules, advanced chemistry cell (ACC) batteries, drones
 Primarily IT hardware (laptops, tablets, servers, PCs)
Component Incentives No additional incentives for specific components Additional incentives for local component manufacturing (e.g., memory modules, SSDs)
Expected Investment ₹2,500 crore (estimated) ₹2,430 crore (estimated)
Employment Generation Not specified in detail 75,000 direct jobs, up to 2 lakh indirect jobs
Production and Export Targets Not explicitly stated ₹3.35 lakh crore production; $12-17 billion exports by 2025-26
Eligibility and Caps Domestic companies with minimum investment of ₹20 crore Global, hybrid, and domestic companies with caps (₹4,500 crore for global, ₹2,250 crore for hybrid, ₹500 crore for domestic)

 

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